Peabody Energy and Glencore Xstrata plan to cut around 500 mining jobs in Australia in a bid to control surging costs amidst declining coal prices.
Peabody will lay off 450 contractor jobs at its coal mines in Queensland and New South Wales (NSW) and Glencore Xstrata will slash 47 jobs as it suspends the $142m Liddell underground expansion at its Ravensworth mine in NSW.
Across the Australian coal sector, companies have undertaken cost-saving programmes such as halting or reducing production, and slashing jobs to offset surging production costs and low coal prices.
Over the last two years, thermal coal prices have declined by 30% to $90 per tonne, while the price of coking coal has dipped by 40% to $130 per tonne in the last year, reports Reuters.
Due to the steep drop in mineral prices globally, several international assets are being put up for sale.
Ravensworth mine general manager Tony Galvin said that the cost-cutting activity across its coal division is an ongoing programme in order to remain viable.
"We are proposing to continue operations on a scaled-down basis, which will mean consolidation of the workforce and, unfortunately, reductions in staff numbers," Galvin added.
This mine currently employs 130 people.
Since 2012, Glencore Xstrata has cut around 700 jobs; about 100 more jobs than it had previously expected.
According to Australian Coal Association, around 9,000 jobs have been axed in the mines of Queensland and New South Wales over the last 18 months.
Image: Peabody operates Wilpinjong and Wambo mines in New South Wales. Photo: Courtesy of Peabody Energy, Inc.